Some SNF providers strongly assert that HAC-POA (Hospital Acquired Condition-Present on Admission) indicators do not apply to claims submitted to SNFs. Yet, recently an entire batch of claims submitted to a large insurance carrier was rejected, because the SNF provider’s billers had not included the POA indicator. The provider resubmitted the claims and mysteriously the insurer processed the claims without further difficulties related to POA. So what happened? In essence, these providers are right about POA and Medicare claims, but in fact, since the beginning of the year, we are observing that some insurers are indeed beginning to impose the POA indicator requirement on SNFs for non-Medicare claims and, possibly, Medicare co-insurance claims.

What is a Present on Admission Indicator? A little background

POA is defined as “being present at the time the order for inpatient admission occurs.”[1] It is not new (to IPPS [Inpatient Prospective Payment System] hospitals, that is) and has been in effect since 2007. “As required by the Deficit Reduction Act of 2005 (DRA), … hospitals must submit POA information on the principal and all secondary diagnoses for inpatient discharges….”[2] This all appears to relate to HACs and the DRA’s intent to not pay for conditions that could have reasonably been prevented which were acquired during a hospital stay.  

So, why is that important? IPPS hospitals do not receive the higher payment for cases when one of the selected conditions is acquired during hospitalization (that is, the condition was not present on admission). The case is paid as though the secondary diagnosis was not present. Here are the POA indicator codes:

But this applies to IPPS hospitals. What about SNFs?

Why POA could be important to SNFs

While the above rule appears not to apply to SNFs billing Medicare, we are indeed seeing that some large insurers, like Cigna, require “the POA indicator to be present for all diagnosis codes submitted on the inpatient claim form. Cigna reserves the right to return any inpatient claim without a POA indicator.”[4] This reinforces what NUBC (National Uniform Billing Committee) requires for all diagnosis codes.[5]

How should billers use the POA?

“POA indicators must be reported on each diagnosis code submitted on facility claims, except for ‘specific’ diagnosis codes. CMS publishes a listing of diagnosis codes that are exempt from the POA indicator requirement….It’s crucial that claims submission staff be familiar with the ICD-10-CM codes currently on the file”[6] SNF billers may have to complete the POA indicator box next to each diagnosis code, using the Y, N, U, or W indicators listed in the table above, especially when submitting claims to CIGNA which is requiring it for all diagnosis codes. Failure to do so may result in claims rejections.

Hint: The indicator is case sensitive. Always use the upper case.

Caution: Other insurance companies, like CIGNA, may require completion of the POA for Medicare co-insurance claims submitted to them for payment.

Advice: Be aware and check with the insurance payers. We are going to keep our eyes on this issue. We’ll keep you posted.

It only makes cents.

What has your experience been with POA?

[1] https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/wPOAFactSheet.pdf

[2] Ibid.

[3] Ibid.

[4] http://www.centercare.com/pdf/referenceguides_nat_803774_2013_2ndqtr.pdf

[5] http://www.nubc.org/aboutus/PDFS/Feb2014TentSchedule.pdf, p. 14 of the pdf

[6] http://www.cgsmedicare.com/parta/pubs/news/2015/0915/cope30310.html

It’s a challenge for skilled nursing operators to benchmark their performance against others in order to reinforce lender confidence and obtain capital at competitive rates.  Similarly, investors need access to current performance data on SNFs across the country to set attractive rates for those with track records of sustainable success. NIC’s Skilled Nursing Data Initiative can be the answer to those needs.

It’s timely – 2016 investment opportunities[1]

Given 2016 first-quarter opportunities, NIC’s Skilled Nursing Data Initiative is positioned to help operators and investors conduct financing transactions confidently. Senior Housing News recently reported that, “A stronger housing market overall also contributed to investors’ interests in assisted living and independent living, and has had a ‘significant impact on seniors housing occupancy levels,’ according to the survey.”[2] It further goes on to report that “Skilled nursing…saw its daily rates rise 2.8% with increased net operating income…from 2014 to 2015 as a result of higher quality services and more efficient operators.”

The Skilled Nursing Data Initiative offers critical up-to-date information

New payment models across the skilled sector continue to evolve and operators need to be responsive. Therefore, investors, who have relied on 12-18 month old historical government data, need current data reflecting today’s operating reality to lend capital with the most advantageous terms.

Partnered with Prime Care Technologies, Inc. (PCT), NIC is creating a data warehouse of current skilled data available to operators and investors. NIC turns to PCT to help operators submit current Key Performance Indicator data securely, confidentially, and automatically.[3]

What kind of data does the Skilled Nursing Data Initiative deliver? Participating SNF operators submit monthly data in the following categories:

• Occupancy
• ADR by Payer Class
• Overall Revenue Trends
• Total Operating Expenses
• Skilled Mix
• Quality Mix
• Patient Day Mix
• Profit Margin/EBITDAR/EBITDARM (profit margin data is sensitive so it is not a requirement)

In return, initiative subscribers get a monthly summary of aggregate and de-identified contributor-submitted information, comparing their performance with national benchmarks. As the database grows over time, subscribers will also be able to compare themselves against regional benchmarks. For the sake of confidentiality, operators will not be able to see the specific data of peer operators.

Summary

For investors, this innovation will boost their confidence as they set rates for capital which are more closely aligned with current performance. For operators, this innovation will enable them to secure competitive rates, so that they can be responsive to the evolving LTPAC landscape

[1] Top Senior Housing Investment Opportunities

[2] CBRE, Inc.’s Investor Survey & Market Outlook

[3] NIC clients do not have to be PCT clients in order to participate. For these operators, PCT will set up and automate data delivery directly to NIC. For PCT clients using PCT’s primeVIEW business intelligence solution, automated data feeds are already in place to securely send data to NIC.

 ___________________________________________________________

Discover 11 ways Business Intelligence can
strengthen your bottom line,
boost investor confidence.

My office is in my home. Occasionally, my wife will step up behind my chair as I am working on the computer and start to massage the back of my neck. Ow! All of a sudden I am aware of a throbbing pain I didn’t know I had. At first it REALLY hurts. In a short time, though, I feel the pent-up tension and throbbing dissipate and I begin to relax. At that point she stops, giving me a reassuring pat on the back. Released, I return to my task, but then I feel the tension begin to return and I have to ask myself, “What’s causing this?” Likewise, sometimes providers get so caught up in the busy-ness of business, they are not aware of some persistent pains which can impact effectiveness and even the bottom line. 

Pain does not necessarily mean gain

One of those pervasive and overlooked pains involves claims rejections. Claims rejections require the billing staff to review the claims, address whatever is missing or in error and resubmit the claims in order to get paid. In some cases, payers reject specific claims over and over again. What’s even more painful is that billers, with the best of intentions, sometimes will put the rejected claims in a file folder which, if not dealt with immediately, can collect dust in some forgotten file drawer. Are you feeling the throb?

What can providers do to minimize the pain of rejected claims? Here are some tips you can follow to limit the number of claims rejections:

1. Pay attention to them. Look at a summary of your rejected claims for the month and sort it by payer and rejection reasons. (In your clearinghouse application, you may be able run a rejection status report and sort by payer.) Do you see a pattern? Are the majority of the rejected claims coming from a few payers? Are the rejections for the same reason? Are the rejected claims submitted by one or two of your new billers? Are these legitimate rejections or do you sense that the payer is simply dragging its fiscal feet?

2. Discover the issue and if it is something you can control, address and fix it quickly. There can be a lot of money at stake. In some cases, the payer implemented a policy change and will no longer accept a specific revenue code. Find out what that code is and make sure your billers use the correct code. This may require a focused review each month before submitting claims to that specific payer to make sure the new policies are followed. If you have a new biller on staff, the errors may be traced to him or her. This can be a great training opportunity.
   
   In some instances, we have discovered that a billing requirement may be published for all payers to implement. However, a few hold-outs still want providers to follow the old policy. Know who they are and make sure your billers know about them too.

3. Check the contracts. Some payers will reject claims containing specific diagnosis codes. The problem may not be that the diagnosis code is not compliant with the ICD10 coding requirement. The payer just may not cover such diagnosis codes. We emphasize again – know your contracts. Having a code on the clinical record is appropriate, but may not be so on the claim. Avoid billing for excluded diagnosis codes.

4. You may have to stop accepting certain insurances/payers. Do certain payers repeatedly reject initial claims submissions for no apparently legitimate reason? Opt out if the payer seems to be problematic. That’s a pain that may require contractual amputation.

No pain, no gain? In fact, in the case of rejected claims, you can gain without the pain by following these tips. Track your rejections and pay attention to trends in billing errors or payer practices. Then take corrective action immediately. Doing so can be as good as a neck massage, because…it makes cents.

If you missed the opportunity to listen in on last week’s CMS Open Door Forum, Understanding the IMPACT Act, you may be at risk of missing some key deadlines in 2016. A little background may be needed. The Improving Medicare Post-Acute Care Transformation (IMPACT) Act of 2014 requires that CMS “make interoperable (Italics added) standardized patient assessment and quality measures data, and data on resource use and other measures to allow for the exchange of data among PAC (post-acute care) and other providers to facilitate coordinated care and improved outcomes.” Loosely translated, that means that the standardized assessment data generated by Long-Term Care Hospitals (LCDS), Skilled Nursing Facilities (MDS), Home Health Agencies (OASIS), and Inpatient Rehabilitation Facilities (IRF-PAI – my favorite acronym du jour) must be interoperable, that is, they must be able to talk to each other.

What's the scoop?

The presenters highlighted the need for immediate action, because of:

• The lack of comparable information across PAC settings undermines the ability to evaluate and differentiate between appropriate care settings for and by individuals and their caregivers
• Standardized PAC assessment data will allow for continued beneficiary access to the most appropriate setting of care
• Standardized PAC assessment data allows CMS to compare quality across PAC settings
• Standardized and interoperable PAC assessment data allows improvements in hospital and PAC discharge planning and the transfer of health information across the care continuum
• Standardized PAC assessment data will allow for PAC payment reform (site neutral or bundled payments)
• Standardized and interoperable PAC assessment data supports service delivery reform

The objective ultimately is to make care safer, reinforce person and family-centered care, promote effective communications and care coordination, promote effective prevention and treatment, promote best practices for healthy living, and make care affordable. Noble aspirations, these.

Fundamentally, the underlying principles include enabling innovation, fostering learning organizations, eliminating disparities, and strengthening infrastructure and data systems. While a couple of these principles as stated are a little vague, the last point about infrastructure and data systems is much clearer. Why? (And this is where I hear the screech of a needle slid across an LP vinyl record.) Because, you have an important reporting deadline to meet come October 1, 2016.

Here's the rub for SNFs

The IMPACT Act requires (italics added) SNFs to report standardized assessment data for the following Quality Measure Domains starting October 1, 2016:

• Functional status/cognitive function
• Skin integrity
• Incidences of major falls

CMS cautions that these domains are not exhaustive. In other words, there is more to come. For example, medication reconciliation and communicating the existence of and providing for the transfer of health information and care preferences have a common 10/1/18 deadline.

What is CMS supposed to do with this data? Why make them interoperable, of course, by standardizing/aligning/harmonizing the data elements, linking them to health IT standards, and making them available “to the public reports mapping assessment data elements to health IT standards.” (Say again?)

What's the hurry?

What are the drivers behind this? To replace fee-for-service with value-based payments with a focus on outcomes in contrast to service volume with emphasis on complex individuals who may receive care from providers across the entire care continuum.

Accomplishing this requires a change in the way providers communicate by relying on the electronic exchange of standardized and interoperable information to:

• Foster effective communication between sites
• Create safer transitions of care for those with the most complex issues
• Improve coordination of care across all sites with a shared care plan

There is so much more the Open Door Forum presented. But critically, providers need to focus on what they must do to report standardized functional status/cognitive function, skin integrity, and incidences of major falls assessment data to CMS starting October 1, 2016. This is just the beginning. Be alert to opportunities to learn more from CMS, your national trade association, and expert bloggers.

Will you be ready? We recommend that you include this among your important 2016 initiatives.

LTPAC CFOs in the 21^st century have to be concerned about many things. But in reality, much of what CFOs do revolves around getting paid on time in the amounts anticipated. Perhaps paying attention to the not-so-obvious factors influencing payment may be worth investigating.

Does this CFO job description for a Life Plan Community (LPC) sound familiar?

• Ensures corporate financial processes and systems, including overall financial controls
• Oversees accounting and financial reporting, financial planning & analysis, and budgeting
• Establishes financial systems and investment accounting and reporting
• Assures all financial operations function efficiently and effectively in compliance with all applicable policies and procedures and statutory/regulatory guidelines (Italics added)
• Strong participation in strategic planning and initiatives, project management

To accomplish this, the essential duties involved include:

• Providing proactive and sound guidance regarding management of assets, investments, and financial trends
• Overseeing a system of responsible accounting including budget and internal controls
• Developing and leading the finance team to maximum productivity and responsiveness (Italics added)
• Ensuring that monthly financial statements are provided on a timely basis
• Acting as a trusted counselor regarding development of new sources of revenue

Although each of these are specific to this LPC, they are for the most part what CFOs are responsible for no matter how many locations the company operates. They have one thing in common – responsible oversight of all income, expenses, and investments. For the purposes of this blog, let’s focus on three ways to shorten the revenue cycle by “developing and leading the finance team to maximum productivity and responsiveness” – specifically by addressing A/R team job satisfaction, claims processing costs, and secondary claims payments.

1. A/R Team Job Satisfaction

In previous blogs, we have addressed such job-satisfaction drivers as empowering the AR team through participation in the admissions process, direct involvement in helping residents apply for Medicaid, sharpening the blade of job skills through recurring education and best-practice updates, employing successful billing habits, making sure the census is correct, checking eligibility regularly, participation in regularly-held billing triple checks, familiarity with key aspects of payer contracts, and getting back to the billing basics. Competence, education, and good, old-fashioned appreciation and positive feedback contribute significantly to reduced turnover and job satisfaction. A happy team is a productive team and a productive team collects money owed.

2. Claims Processing Costs

Does it matter how much it costs to process claims? Yes. Let’s just take a simple example. An operator of 40 facilities in the western US used to process claims at the facility level. But with the advent of all-in-one claims clearinghouses, centralizing the billing function in the corporate office became doable and resulted in cost-saving efficiencies. Much of the claims preparation, submission, corrections as needed, follow-up, and payment receipts could be performed on line and for the most part automatically. Fewer billers were needed, resulting in a reduction in labor costs. Just as importantly, they collected money more quickly.

3. Medicare Secondary Payer (MSP) Claims

In the case cited in the previous paragraph, the provider in question was able to automate the processing of MSP claims resulting in an accelerated payment cycle with a reduction of 30 days between secondary claims filing and payment receipts. 

Is your company getting paid on time in the amount anticipated at lower costs? We suggest that with your AR manager(s) you take a hard look at these three productivity contributors and determine what initiatives need your support. Because, really, it all makes good cents.